Addressing threats to health care's core values, especially those stemming from concentration and abuse of power. Advocating for accountability, integrity, transparency, honesty and ethics in leadership and governance of health care.

Thursday, February 10, 2011

Passport to ... Fraud? - AmeriHealth Mercy Settles

Back in November, 2010, we discussed the relatively opulent pay and perks given to and conflicts of interest affecting leaders of Passport Health Plan, a non-profit, state (Kentucky) supported Medicaid managed care organization/ health insurer. This seemed to be another case of health care organizational insiders putting their personal gain ahead of their mission, which was particularly unseemly because their mission was serving the poor.

Now Passport Health is in the news again, and not in a favorable way, as per the Louisville (Kentucky) Courier-Journal:

Passport Health Plan’s main contractor has agreed to pay more than $2 million in damages to the Kentucky Medicaid program to settle a fraud investigation, Attorney General Jack Conway announced Wednesday.

The settlement with AmeriHealth Mercy Plan is the result of a nine-month investigation by the Attorney General's Medicaid Fraud Unit into alleged falsification of records by the company that entitled it to more than $677,000 in bonus money for good performance.

Conway said the investigation centered on an allegation from a whistleblower that AmeriHealth falsely reported data to the state Medicaid Services Department on the number of Medicaid recipients who received cervical cancer screenings in 2009. The false numbers allowed AmeriHealth to receive the bonus money under the terms of its contract.

We have discussed a variety of cases of leaders of health care organizations getting compensation or benefits that seemed disproportionate in their organizations' context. The usual justification seems to be that it takes such rewards to attract the excellent leaders needed by health care organization.

Here is another example of leaders who not only seemed to get excessive compensation and benefits, but whose performance seemed far from excellent.

Moreover, it suggests that compensation and benefits may actually have an inverse correlation to performance. Organizations whose stewards seem unrealistic about the talents of their hired managers, and dependent on material rewards to retain such managers may lack good stewardship. Leaders who find themselves rewarded beyond any reasonable evaluation of their work may learn the lesson that they cannot ask for too much. Meanwhile, the excess of their rewards may inspire increasing greed rather than increasing devotion to the mission, while the pay and perks increasingly place them in a bubble that insulates from the concerns of the common people who their organizations are supposed to serve.

As we have said before, far too often the leaders of not-for-profit health care institutions seem more interested in padding their own bottom lines than upholding the institutions' missions. They often seem entirely unaware of their duty to put those missions ahead of their own self-interest. Like the financial services sector in the era of "greed is good," health care too often seems run by "insiders hijacking established institutions for their personal benefit." True health care reform would encourage leadership of health care who understand health care and care about its mission, rather than those who see a quick way to make a small fortune.

PS - Also note that this is also another example of the sort of legal settlements of misbehavior by health care organizations that seems to have little deterrent effect, mainly because no individual who authorized, directed or implemented the bad behavior suffers any negative consequences. See our discussion in these previous posts. True health care reform would also hold leaders accountable for their organizations' misdeeds.

Contributors

Contact Us

Email: info at firmfound dot org
or go to the web-site for FIRM - the Foundation for Integrity and Responsibility in Medicine

More About FIRM and Health Care Renewal

FIRM - the Foundation for Integrity and Responsibility in Medicine is a 501(c)3 that researches problems with leadership and governance in health care that threaten core values, and disseminates our findings to physicians, health care researchers and policy-makers, and the public at large. FIRM advocates representative, transparent, accountable and ethical health care governance, and hopes to empower health care professionals and patients to promote better health care leadership.

FIRM depends on contributions from individuals and non-profit organizations. FIRM does not accept any direct support from for-profit health care corporations.

FIRM welcomes support from individuals and non-profit organizations. If you are interested in donating to FIRM, please email info at firmfound dot org, snail mail us at 16 Cutler St, Suite 104, Warren, RI, 02885, USA, or see our web-site.

Upcoming Meetings and Events

Subscribe To Health Care Renewal

Policies: Blog Roll and Comments

Our blogroll is meant to include blogs that provide interesting content relevant to what we write. It is not an endorsement in any way of any specific blog.

We accept comments, especially from registered Blogger users. If you do not wish to register with Blogger, we will accept anonymous comments, although prefer that they contain identification of the commenter.

We encourage thoughtful comments relevant to the issues brought up by the posts on Health Care Renewal.

All comments are moderated. We will reject spam, profanity, advertising of products or services not directly related to the content of this blog.

We will reject any unsubstantiated accusations or allegations.

Nonetheless, all comments represent only the opinions of those making them. The appearance of comments does not imply endorsement by the Health Care Renewal bloggers.

Please email general comments about the blog, other concerns, or questions to info AT firmfound DOT org